Google compensates Apple with a substantial 36% cut of the total advertising revenue generated from searches made through Google’s search engine on Safari browser, this deal is part of a longstanding arrangement where Google has paid to be the default search engine on Safari and other browsers, such as Firefox, in 2021 alone, Google spent $26.3 billion to maintain this status, with $18 billion of that amount going to Apple.
The disclosure of these figures was made by Kevin Murphy, a professor of economics at the University of Chicago, during his testimony in an ongoing trial at the Department of Justice in Washington, the disclosure, which was supposed to remain confidential, visibly embarrassed Google’s attorney, John Schmidtlein.
Eddy Cue, Senior Vice President of Services at Apple, defended the deal in September, stating that the iPhone manufacturer aims to capture a significant share of the revenue Google earns from Safari traffic.
However, the companies had agreed on a lesser figure than what Murphy revealed, this disclosed amount sheds more light on the complex relationship between the two tech giants, which has been under antitrust scrutiny in recent years.
The Department of Justice has accused Google of using its resources to maintain market dominance by paying companies like Apple, whose devices are used collectively by billions of users, to remain the default search engine on Safari.
In 2021, it was reported that Google paid approximately $18 billion to Apple to secure its position as the default search engine in Safari, as revealed by a New York Times report.
Bloomberg highlighted that both Google and Apple raised objections last week to making the details of their agreement public, with Google stating that revealing more details could unreasonably undermine its competitive position relative to competitors.
The partnership between the two companies, dating back to 2002, has positioned Google as the default search engine in Safari, the exact amount of advertising revenue Google generates from Safari is unclear, but 36% of this figure could potentially represent tens of billions of dollars, given Google’s total revenue of $279.8 billion in 2022, most of which came from advertising.
